Interview: Sarah Lacy

May 05, 2008
by Aarti Shah

Sarah Lacy recently created an uproar during her controversial keynote interview with Facebook CEO Mark Zuckerberg at South by Southwest Interactive. Lacy talks to PRWeek about what the controversy means for journalists in the era of social media, and her upcoming book Once You're Lucky. Twice You're Good that chronicles the founders of some of the most talked about Web 2.0 startups.

Sarah Lacy recently created an uproar during her controversial keynote interview with Facebook CEO Mark Zuckerberg at South by Southwest Interactive. Lacy talks to PRWeek about what the controversy means for journalists in the era of social media, and her upcoming book Once You're Lucky. Twice You're Good that chronicles the founders of some of the most talked about Web 2.0 startups.

PRWeek: What do you think Web 2.0 has been all about? Sarah Lacy: I talk a lot in book about the link between open-source software and Web 2.0, and the obvious one is a lot of these companies started because it was so cheap and easy to build on open source. There is also a big difference between Web 1.0 and 2.0 when it comes to how emotional people feel about it and how powerful it is. There is a sense that in Web 1.0 there was such an emphasis on building a public company and the business aspect. That is almost the position you don't want to be in with a Web 2.0 company because [the business development guy] is not doing a lot. It's not about brokering these deals with old media or bargaining for eyeballs, it is much more about building something people care about. But I think, as a result, there are probably bigger public companies and way more public companies that come out of the first wave. The second wave of Web companies are really more socially transformative.
PRWeek: Now that we've seen some cooling of Web 2.0, how much of it do you think has been hype?Lacy: Of course there is hype in any Silicon Valley cycle, and that was definitely going on with Web 2.0. But I think people who tried to say this was anything like what happened in the late 90s were just really ill-formed and were still going off really emotional visceral reactions. Obviously, when you have a lot of social networks, or photo-sharing companies, or video-sharing companies, they are not all going to be successful, most of them are going to go out of business. [Yet] I think it points to the power of why Web 2.0 is so exciting and so socially transformative. It is because people were so excited about these technologies that it felt like a bigger of a bubble than what was actually happening.
PRWeek: What do you feel like you covered about Web 2.0 in the book that is missing from other media surrounding the second wave?Lacy: I wasn't trying to write “TechCrunch the book.” I was in a situation in 2006 where I needed to pick people to follow that would still be relevant in 2008. So I tried to really focus it on a handful of companies and individuals that I thought were really doing interesting and transformative things. I didn't follow a lot of the dumb ideas, the mass failures, and all of that. So there is probably a huge part of people's reality that isn't really represented in this book. Beyond that, by focusing on only a few you can really dig into these companies a lot deeper, and you can really get a sense of what's it like to be in this position. What really resonates with people who have read the book is we all refer constantly to the companies I talk about in my book, like Facebook, Digg, and Slide.

PRWeek: What insight do you give about these companies and their founders that isn't already out there? Lacy: We have this desire in Silicon Valley to mythologize people make them into two-dimensional icons. [Yet] a lot of these people are really shy or they don't really trust the media or they're busy building their businesses. So you get this whole media hype cycle and iconification that doesn't really describe a person but is our depiction of that person. A lot of what I did in my book is sit with someone four to six or eight hours [multiple times]. You can't really hide who you are for more than an hour. So what emerges is a way more complex, nuanced, and at times a very human and vulnerable picture. I think [the book is] getting that real sense of what it's actually like to be that person and what it's like to actually be inside a startup when these things take off and go crazy when they do.

PRWeek: What is biggest challenge of this reporting style of immersing yourself in the culture that way?Lacy: When you go from being a beat reporter to being an author, and you write about someone's life and what might be an opening anecdote in an article becomes like a 25-page scene or a whole a chapter – you get to this level of intimacy or detail that most reporters really don't. At times I was so in the middle of dramas and companies and could see different sides of issues and where things might be colliding and I had to just watch things play out – kind of like a documentary filmmaker and not say anything or be a mediator at all which is sort of hard to do.

PRWeek: Could you go back to beat reporting now? Lacy: I felt like the book changed my relationship with everyone in that I couldn't go back to being a normal beat reporter or I couldn't cover the Web scene. What you want as a reporter is to be at the level where you know the CEO of the company, you have really good sources throughout the company, you may have that secret source that is at VP level who really gives you all the dirt, and then you go to the CEO and get them to confirm or deny it – but ultimately you want to be close enough but still have enough distance. But when you spend hundreds of hours with the CEO and then you're trying to cover it as a beat reporter again – it's kind of hard to go back through and put back in that protocol.

PRWeek: Did you have enough access to the founders to tell the full story? Lacy: I had such great access; it was such a fascinating story. I couldn't have fictionalized the characters and have them be more fascinating than they were. The people were so quirky and interesting and honest with me and so direct. There were points where I felt like I just had to keep up and the book was sort of writing itself and running on its own.
PRWeek: How did you deal with the founders' PR teams?Lacy: I was lucky because I already knew the people really well, which is basically why I basically got the book deal to begin with. I had very unique access to a lot of people that was a result of me being a reporter in Silicon Valley and covering startups for a long time. And also I was interested in certain people before everyone else in the media was interested in them. I first interviewed [Mark] Zuckerberg when he was 19 or 20 , three or four years ago I started building a relationship with Marc Andreessen. So the relationships I had with people were so deep and so hard-fought over so many years that by the time I got to doing the book, there were not really any PR people in the middle. I already had such long-term relationships with them, it's not like I was waiting till they were a big company and then calling their PR firm and saying “oh, I'm going to do a book.”

PRWeek: What is the biggest point you want to make about Web 2.0 in the book? Lacy: I think it goes back to this aspect of community and degree to which these sites have become so enmeshed in our ordinary lives and such extensions of our off-line relationships with people. There are all these core human needs Web 2.0 really satisfies in ways that I don't think technology ever has. I think that's why people describe these sites as being addictive or say you have really use something like Twitter to realize it's not as frivolous as it seems to be. And I think that as much as that makes it really powerful – the degree to which there is this heavy, heavy use and passion for a community. It also makes it really unstable. We've seen this with Facebook. People get really upset because the feel so personally about these sites, if there is then a sense that people are trying to exploit them or exploit the trust they put into the site people get really emotional.

PRWeek: The Silicon Valley media didn't fare too well after the first wave – do you think it is better poised this time around?Lacy: I think, in the first wave, a lot of the carnage was from a lot of these huge magazines that popped up, and something that has been very emblematic of the difference between Web 1.0 and 2.0 has been the capital efficiency and really using technology and outsourcing to make things much more efficient. That's what you've seen with "publications" that have popped up this time – they are all really, really lean blogs. In aggregate, blogs are definitely wrecking a lot of havoc on media, but if Tech Crunch, all the Gawker properties, and GigaOm went under tomorrow – it wouldn't affect San Francisco's economy. I think media has been a lot smarter about the opportunities they've seen surrounding this.

PRWeek: What about the direct impact of Web 2.0 on reporters? Lacy: You're at a point now where the best reporters [are leaving] their mainstream publications, and why wouldn't they? It's not a fun place to be at a newspaper or magazine right now. So you have a situation where someone like Kara Swisher, who for years wrote for the Wall Street Journal, is now writing for a blog. All these branded journalists don't really need their publications anymore. I think crash or not – that is something that is going to continue because media is in such a bad place right now.

PRWeek: Do you think there lessons to be learned for journalist from what happened with you at South by Southwest and what it means to be a reporter in the age in social media? Lacy: In many ways what happens with Twitter, what happens with comments on blogs, and a lot these places where people weigh in isn't really new behavior, it's just behavior that is broadcast to everyone. The interesting thing about being so public is it tends to snowball and people tend to get very whipped up in it. There is also the cynical and realistic way to look at it – blogs are in the business of driving traffic. So if there is a hot-button topic that people are getting emotional about, it's them doing their jobs to keep on it and drive as much controversy as they can. If you were to go online and blindly read these things [about my keynote at SXSW], you might think this person must be living in box car because clearly everyone thinks she's horrible. Well, it's well-documented – it's not just me, this happens to everyone. I think there is always a phenomenon of a vocal minority and the Internet just makes that makes that vocal minority louder. I think what is good for media to recognize is that it's the same vocal minority frequently that you hear through letters and e-mails and everything else.

PRWeek: How do you feel about the coverage of your keynote at SXSW? Lacy: The situation of SXSW was interesting because in the aftermath, you had a situation that I don't think I've ever seen before and don't think we'll ever see again. You had people like [Michael] Arrington, Kara Swisher, and [bloggers at] Valleywag all agreeing that it was a complete witch hunt. Everyone got worked into a frenzy and I think that journalists that were there though "all these Twitters – so everyone must feel this way." That's bad reporting. But if I were journalist there, I don't know, maybe I would have said the same thing.

PRWeek: Do you think social media enabled the backlash? Lacy: What's interesting is when you have a medium like Twitter or a blog, you learn a lot about what's driving people's behavior. For instance, I said in the middle of the whole keynote, I invited people to e-mail me and tell me what their whole issue was. I got thousands and thousands of e-mails [but] I didn't get a single negative e-mail, I didn't get a single direct negative Twitter. It became a lot easier to deal with because either the people were huge cowards or it was a lot of grandstanding. I've got to tell you, the most innocuous articles I've written – I've gotten angry e-mails. People are not shy about sending angry e-mails but when you give people a million media to communicate with you – and no one does – it says something about what's really going on.

PRWeek: You also used Twitter to respond to your critics. Can you address how journalists can use social media to respond to criticism and feedback?Lacy: Larger than the whole SXSW thing, I've been a huge proponent of using all social media as a reporter to engage with readers. It's a great way to directly interact with people who like your work, and it's another thing that really facilitates this move where reporters who are successful are increasingly less and less reliant on their publications and are becoming their own entities. I am a huge fan of using social media to connect with people because I think there was this “ivory tower” aspect of journalism where people might read a byline for years but have no idea about the person who was behind it and never get to communicate with them or ask them a question.

PRWeek: Did the incident change your relationship with social media in the context of being a journalist? Lacy: No, not at all. You have to understand, in this space, everyone gets attacked constantly. Look at someone at like [Robert] Scoble, Arrington, Zuckerberg, or [entrepreneur] Kevin Rose – anyone. Whether it's an entrepreneur or journalist, we all get attacked constantly – it's the nature of it. There is so much opportunity for people to jump up and down and scream and shout and for things to snowball. It's the reality of doing business in this sector, so it's not the first time it happened to me, and it won't be the last time it'll happen to me. So it would be pretty silly if I just said I'm never using Twitter again because people on Twitter were mean.

PRWeek: What's your experience with Silicon Valley PR people outside of working on your book? Lacy: You know, they're horrendous. I'm saying that partially jokingly. There are a lot of clichés about PR people that are there for a reason. But actually, I think PR people in the Valley are somewhat savvier because they have to be, because they have to deal with so many requests and it's such a pressure cooker. That having been said, it never ceases to amaze me – or other journalists – the degree to which a lot of PR people seem to do things intentionally to piss you off. It's like just the lack of common sense. For instance, I have a column in BusinessWeek called “Valley Girl,” yet I get constant pitches from people [asking me to meet them in New York]. I only write about Silicon Valley – why would you assume I'm in New York? When a PR person asks why is it a big deal that they got your name wrong or sent you a pitch on something you would never cover, it's because when you get hundreds of those a day – it's incredibly annoying. It's basically like having telemarketers call you all day long for something you never want to buy.